CAIRO: Egyptian Minister of Finance Hazem al-Beblawy said today that Egypt will neither privitize nor nationalize in the wake of its January 25 Revolution. “The Egyptian economy is passing through a difficult phase after the January 25 Revolution,” said Beblawy. “However, Egypt is expected to achieve great economic progress after getting rid of the former regime. Egypt currently follows market economy policies, which include certain rules. However, if the people want to change the economic system the government will accept this, said Beblawy. “Egypt will not apply privatization or nationalization again,” he said, adding that Egypt respects private property. “The Egyptian government will strongly support the public sector in the coming phase,” he said. Beblawy held a press conference today at the Ministry of Finance. He said Egypt faces a liquidity crisis like that in the U.S. He also said he believes Egypt can fix this problem by balancing the general budget and covering its deficit. The Egyptian economy needs a long-term strategy, said Beblawy. This strategy must fit the educational, industrial and productive visions of the Egyptian people, he said. However, the minimum wages cannot be increased right not because of the government's large deficit. The Egyptian government is serious about determining maximum wages and they will be announced soon, said Beblawy. Maximum wages will only be applied to governmental employees and not to private sector employees. “Egypt is a country of limited resources and cannot use its resources properly,” said Beblawy. He also said the budget deficit has risen to 134 billion EGP (U.S. $22.7 billion) because deficits have accumulated in past years. “The first deficit did not exceed 28 billion EGP, but the interest has reached 106 billion,” he said. Beblawi confirmed his most important aim is to decrease this deficit by supporting banks. He said he is not opposed to external borrowing if it is necessary. Beblawy plans to present a suggestion to the Egyptian government to decrease governmental expenditure. The government does not need to print more money, he added. Egyptian subsidies need to be revised, according to Beblawy, because a lot of money is wasted on unnecessary or badly directed subsidies. “For example, why does the cement industry need to be subsidized?” he asked. Beblawi said governmental organizations are partly to blame for Egypt's debt. The petrol association's debt is 100 billion EGP (U.S. $17 billion) and the electricity association owes the petrol association 40 billion EGP (U.S. $6.8 billion). Egypt's ruling military council will hold a meeting with businessmen and economic ministers to discuss their demands and strategies.
